Chicago alderman from Daley family implicated in bank embezzlement
Chicago Ald. Patrick Daley Thompson was implicated in the plea agreement of a former bank employee who federal prosecutors said played a critical role in the embezzlement scheme. She said millions in theft was covered up before the bank failed.
A bank employee has become the first person to plead guilty in a decades-long embezzlement scheme that saw $66 million in falsified loans and repayments made to clients, including now-indicted Chicago Ald. Patrick Daley Thompson.
Alicia Mandujano, who served as a loan servicer and secretary under the former president of the defunct Washington Federal Bank for Saving in Bridgeport, Illinois, admitted Jan. 12 to covering up millions in unpaid loans at her boss’ behest. Those included $219,000 in loans to Thompson, prosecutors said.
The massive federal investigation issued charges of tax fraud against Thompson, who faces trial Feb. 4. Mandujano’s statement said late bank President John Gembara, who killed himself in 2017 as the embezzlements began unraveling, told her to make it appear loans were repaid.
Thompson’s tax issues stem from claiming mortgage interest deductions for the loans that were not actually being repaid, charges state. He has pleaded “not guilty.”
Mandujano’s 27-page plea agreement said Thompson accepted three checks from Gembara directly between 2011 and 2014 “that were in excess of the principal amount on Thompson’s note.” After the alderman failed to make loan repayments, Mandujano was instructed by Gembara to falsify Thompson’s records.
Mandujano claims no one else at the bank besides Gembara knew about the embezzlement scheme. However, at least two more former bank employees are expected to plead guilty ahead of Thompson’s trial.
Thompson has been an alderman since 2015 and is the grandson of former Chicago Mayor Richard J. Daley and nephew of Mayor Richard M. Daley. Prosecutors said he lied to the Federal Deposit Insurance Corp. about how much money he owed to the Bridgeport bank after federal regulators shut it down in December 2017.
Thompson also claimed to have paid more than $170,000 in mortgage interest between 2013 and 2017, charges state. Washington Federal allegedly sent IRS forms to the alderman that falsely accounted for the payments.
Chicago’s former deputy commissioner for the Department of Streets and Sanitation, William M. Mahon, was recently indicted in connection with the embezzlement scheme for fraud. The longtime consort of former Mayor Richard M. Daley in December became one of 15 people charged in the ongoing federal investigation.